Drug firm settles Seroxat research claim

GlaxoSmithKline escaped with a rap over the knuckles yesterday in the latest crusade against alleged corporate wrong-doing spearheaded by the New York attorney general, Eliot Spitzer.

GlaxoSmithKline escaped with a rap over the knuckles yesterday in the latest crusade against alleged corporate wrong-doing spearheaded by the New York attorney general, Eliot Spitzer.

The Anglo-American drugs giant has agreed to pay $2.5m (£1.4m) in settlement of a court case brought by Mr Spitzer, who claimed GSK had suppressed data suggesting its anti-depressant drug Paxil (called Seroxat in the UK) could cause suicidal tendencies when prescribed to children.

The group has released the results of clinical testing of the drug conducted since December 2000, when the merger between Glaxo Wellcome and SmithKline Beecham took place. It said it would now try to post future data "within stated timeframes".

Glaxo shares bounced 2.4 per cent to £11.31 yesterday in a strong market for pharmaceutical stocks. City analysts suggested the agreement was a victory for GSK, which is suffering severe pressure from generic rivals. Some commentators suggested it might have faced a payout amounting to hundreds of millions of dollars as a result of the Spitzer case.

One said: "There was talk [Mr Spitzer] could have recouped the profits they allegedly made from teenagers. In the order of things, it's peanuts for Glaxo. I am sure they will have been delighted to have got rid of that."

The group continued to deny the validity of Mr Spitzer's charges, saying the payment was to "avoid the high costs and time required to defend itself in protracted litigation".

Prescriptions of Seroxat for children were banned by both US and UK regulators last year after the drug was linked with "suicidal thoughts" in under-18s.

The demands for more public disclosure come amid claims that researchers are under pressure to publish positive results from trials. Mr Spitzer claimed that GSK had published only one of five trials on Paxil, the group's best-selling drug until it lost patent protection last year, effectively suppressing results that did not favour the drug.